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Stockbroker allegedly fired for having credit card debt

On Behalf of | Sep 18, 2012 | Wrongful Termination |

Employment agreements in Minnesota vary from employer to employer, but generally cover the areas of an employee’s duties, the terms of the employment, and payment. Many also include disciplinary actions that may be taken towards employees if they do not act in accordance with the terms of their employment.

Yet despite the protections offered by federal anti-discrimination law or the contractual terms particular to an employment agreement, wrongful terminations still occur. When they do, it can be difficult to disprove an employer’s allegation that the termination was for cause. A stockbroker recently learned this lesson the hard way.

Brokers are registered with the Financial Industry Regulatory Authority, which requires disclosure of certain financial troubles. However, the stockbroker allegedly failed to inform either FINRA or his employer of the $30,000 wage garnishment judgments against him for his unpaid credit card debts. His employer found out about the judgments only after it received the garnishment documents from the man’s creditors. The man was able to keep his job after this first instance. However, when it happened again six months later — this time for unpaid credit card bills totaling around $54,000 — the man was fired.

Debt status is not a protected category under federal anti-discrimination law. However, Title III of the Consumer Credit Protection Act offers protection against job termination on the basis of wage garnishment brought by one creditor collecting on a single debt. The CCPA also limits the amount of an employee’s earnings that may be garnished. Unfortunately, when a worker’s pay is separately garnished by multiple creditors or for multiple debts, the CCPA’s federal protections may not apply.

In this case, the man may not qualify under the CCPA. It is also unclear whether the man’s employment contract with his employer was “at will” or contained a clause prohibiting termination of an employee without cause. If the latter, the man may be able to bring a wrongful termination claim. Such a claim may also be available where the firing was motivated by discrimination or for a reason that violates public policy established in Minnesota or federal law. An experienced employment law attorney will be able to review the options available in a particular case.

Source: Time, “Yikes – When Debt Costs You a Job,” Martha C. White, Sept. 17, 2012



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